Scribd Logo
Upload

Welcome to Scribd!

  • 36 views

    Seminar 2

    Uploaded by

    vikki_naga
    Planning is the process of setting goals and strategies to achieve an organization's mission. There are three stages to the planning process: 1) determining the mission and goals, 2) formulating strategies to achieve them, and 3) implementing those strategies. Planning occurs at three levels - corporate, business, and functional - with each level building on the plans of the level above. Good planning provides direction, coordination, participation, and control for an organization.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd

    Seminar 2

    Uploaded by

    vikki_naga
    36 views24 pages
    Planning is the process of setting goals and strategies to achieve an organization's mission. There are three stages to the planning process: 1) determining the mission and goals, 2) formulating strategies to achieve them, and 3) implementing those strategies. Planning occurs at three levels - corporate, business, and functional - with each level building on the plans of the level above. Good planning provides direction, coordination, participation, and control for an organization.

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    PPT, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Planning is the process of setting goals and strategies to achieve an organization's mission. There are three stages to the planning process: 1) determining the mission and goals, 2) formulating strategies to achieve them, and 3) implementing those strategies. Planning occurs at three levels - corporate, business, and functional - with each level building on the plans of the level above. Good planning provides direction, coordination, participation, and control for an organization.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    36 views24 pages

    Seminar 2

    Uploaded by

    vikki_naga
    Planning is the process of setting goals and strategies to achieve an organization's mission. There are three stages to the planning process: 1) determining the mission and goals, 2) formulating strategies to achieve them, and 3) implementing those strategies. Planning occurs at three levels - corporate, business, and functional - with each level building on the plans of the level above. Good planning provides direction, coordination, participation, and control for an organization.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    You are on page 1of 24

    PLANNING IN MANAGEMENT

    PLANNING
    How To Best Meet Your Mission We must plan for the future, because people who stay in the present will remain in the past.
    Abraham Lincoln

    The Planning Process


    Planning

    is the process used by managers to identify and select goals and courses of action for the organization. The organizational plan that results from the planning process details the goals to be attained. The pattern of decisions managers take to reach these goals is the organizations strategy.

    Three Stages of the Planning Process


    Determining the Organizations mission and goals
    (Define the business)

    Strategy formulation
    (Analyze current situation & develop strategies)

    Strategy Implementation
    (Allocate resources & responsibilities to achieve strategies)

    Planning Process Stages

    Organizational mission: defined in the mission statement which is a broad declaration of the overriding purpose.
    The

    mission statement identifies product, customers and how the firm differs from competitors.

    Formulating strategy: managers analyze current situation and develop strategies needed to achieve the mission. Implementing strategy: managers must decide how to allocate resources between groups to ensure the strategy is achieved.

    Who Plans?

    Corporate level planning is done by top managers.

    Business and functional planning is done by divisional and functional managers.

    Levels of Planning
    Corporatelevel Plan Goal Setting Strategy Formulation
    Corporate mission & goals

    Businesslevel Plan
    Divisional goals

    Functional level Plan


    Functional goals

    Corporatelevel strategy

    Businesslevel strategy

    Functionallevel strategy

    Strategy Implementation

    Design of Corporate Structure Control

    Design of Business-unit Structure Control

    Design of Functional Structure Control

    Planning Levels

    Corporate-level: decisions by top managers. Considers on which businesses or markets to be in. Provides a framework for all other planning. Business-level: details divisional long-term goals and structure. Identifies how this business meets corporate goals. Shows how the business will compete in market. Functional-level: actions taken by managers in departments of manufacturing, marketing, etc. These plans state exactly how business-level strategies are accomplished.

    Planning at General Electric


    Corporate Corporate Level Level Business Business Level Level

    CEO

    Corporate Office

    GE Aircraft

    GE Lighting

    GE Motors

    GE Plastics

    NBC

    Functional Functional Level Level

    Manufacturing Marketing

    Accounting R&D

    Characteristics of Plans

    Time horizon: refers to how far in the future the plan applies.
    Long-term Intermediate-term Short-term

    Most firms have a rolling planning cycle to amend plans constantly.

    Types of Plans

    Standing plans: for programmed decisions.


    Managers

    develop policies, rules, and standard operating procedures (SOP).

    Single-use plans: developed for a one-time, non programmed issue. Usually consist of programs and projects.

    Why Planning is Important


    Planning determines where the organization is now and where it will be in the future. Good planning provides:
    Participation Sense

    of direction & purpose Coordination Control

    Scenario Planning

    Scenario Planning: generates several forecasts of different future conditions and analyzes how to effectively respond to them.
    Planning

    seeks to prepare for the future, but the future is unknown. By generating multiple possible futures we can see how our plans might work in each. Scenario planning is a learning tool to improve planning results.

    Determining Mission and Goals

    This is the first step of the planning process and is accomplished by: A. Define the business: seeks to identify our customer and the needs we can and should satisfy. B. Establishing major goals: states who will compete in the business.

    Strategy Formulation
    Managers analyze the current situation to develop strategies achieving the mission. SWOT analysis: a planning to identify:

    Organizational

    Strengths and Weaknesses.

    Strengths: manufacturing ability, marketing skills. Weaknesses: high labor turnover, weak financials.
    Environmental

    Opportunities and Threats.

    Opportunities: new markets. Threats: economic recession, competitors

    Planning & Strategy Formulation


    Corporate-level strategy develop a plan of action maximizing long-run value SWOT analysis identifies strengths & weaknesses inside the firm and opportunities & threats in the environment.

    Business-level strategy a plan of action to take advantage of opportunities and minimize threats Functional-level strategy a plan of action improving departments ability to create value

    The Five Forces Model


    Potential Potential for Entry for Entry

    Power of Power of Buyer Buyer

    Rivalry Among Organizations

    Power of Power of Supplier Supplier

    Substitute Substitute Products Products

    The Five Forces


    1. Level of Rivalry in an industry: how intense is the current competition with competitors?2 2. Potential for entry: how easy is it for new firms to enter the industry? 3. Power of Suppliers: If there are only a few suppliers of important items, supply costs rise. 4. Power of Buyers: If there are only a few, large buyers, they can bargain down prices. 5. Substitutes: More available substitutes tend to drive down prices and profits.

    International Strategy
    Global

    strategy: a single, standard product and marketing approach is used in all countries. provides for lower cost. strategy: products and marketing are customized for each country of operation. Customization provides for higher costs.

    Multidomestic

    Corporate-Level Strategies

    Concentrate in single business: McDonalds focuses in the fast food business. Can become very strong, but can be risky. Diversification: Organization moves into new businesses and services. Related diversification: firm diversifies in similar areas to build upon existing divisions. Unrelated diversification: buy business in new areas. Very hard to manage.

    Table 7.2

    Business-level Strategies
    Number of market segments
    Many Few
    Low-Cost Differentiation

    Focused Low-Cost

    Focused Differentiated

    Low Cost Differentiation

    Strategy

    Business Strategies
    Low-cost:

    gain a competitive advantage by driving down organizational costs.


    Managers manufacture at lower cost, reduce waste. Lower costs than competition mean lower prices.

    Differentiation:

    gain a competitive advantage by making your products different from competitors.


    Differentiation must be valued by the customer. Successful differentiation allows you to charge more for a product.

    Stuck

    in the middle: It is difficult to simultaneously become differentiated and low cost.

    Functional-level Strategies
    Seeks to have each department add value to a good or service. Marketing, service, production all add value to a good or service.

    Value

    is added in two ways:

    1. lower the operational costs of providing the value in products. 2. add new value to the product by differentiating.

    Goals for successful functional strategies:


    1. 2. 3. 4.

    Attain superior efficiency Attain superior quality Attain superior innovation Attain superior responsiveness to customers

    You might also like